Cryptocurrency frauds: the FTX story

Esther Lea Ledoux and Nadia Smaili

Journal of Financial Crime, 2024, vol. 32, issue 3, 530-544

Abstract: Purpose - The purpose of this paper is to analyze FTX cryptocurrency frauds. FTX is a former cryptocurrency exchange platform that went bankrupt because of fraud in 2022. Design/methodology/approach - Using a qualitative method and a case study of FTX, the authors document the multiple fraud schemes perpetrated. The authors collected media and research articles that discussed the FTX case. The authors analyzed 18 articles. Findings - Based on this case, the authors highlight the governance and ethics weaknesses in the FTX environment. The authors also discuss cryptocurrency risks and regulation of cryptocurrencies. The FTX affair has shaken up the international regulatory world, which has been seeking solutions to protect customers and investors and helping banks take positions since 2022. Originality/value - This study contributes to the fraud literature by deeply examining cryptocurrency fraud risks. In addition, the findings could help financial institutions and guide them in the cryptocurrency world.

Keywords: Fraud; Crypto; Cryptocurrency; Cryptoassets; Banking; Bitcoin; Ethereum; Blockchain; FTX; Regulation (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfcpps:jfc-01-2024-0022

DOI: 10.1108/JFC-01-2024-0022

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